Investors Shun Shell on Gulf Oil Leak Reports

The company reported a large surface slick of unknown origin

   
Investors Shun Shell on Gulf Oil Leak Reports

A potential oil leak in the Gulf of Mexico is raising concern today. Royal Dutch Shell (NYSE:RDS.A, RDS.B) reported that it has spotted an oil slick of some 10 square miles in the Gulf. The company says it has already notified the National Response Center and the Louisiana Responder, an emergency-response ship equipped to contain oil slicks.

The source of the surface oil is not yet known, although Shell says it was spotted in the area between two of its wells, Mars and Ursa. Shell added that it has no indication that those wells are the slick’s source.

With memories of the BP (NYSE:BP) Gulf oil-spill disaster of 2010 still fresh, investors were quick to assume the worst Thursday morning, pushing Shell’s shares down as much as 5.5% in London trading, weighing on the FTSE’s performance. Not helping sentiment as well is Total’s (NYSE:TOT) natural gas leak in the North Sea, which itself has the potential to be another major environmental — and business — disaster.

In the U.S., Shell was also sharply lower in premarket trading, down nearly 6%. With Shell’s shares already down so far this by more than 8%, the company is surely doing the corporate version of praying that the oil indeed isn’t coming from one of its wells.


Article printed from InvestorPlace Media, http://investorplace.com/2012/04/investors-shun-shell-on-gulf-oil-leak-reports/.

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